[3B. Receive the Annual Comprehensive Financial Report for the fiscal year ended September 30, 2023, which includes the independent auditor’s report. ]

ALREADY. NOW IT IS BORING FROM HERE, SORRY. ITEM 3B, RECEIVED THE ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE FISCAL YEAR ENDING SEPTEMBER 30TH, 2023, WHICH INCLUDES THE INDEPENDENT AUDITOR'S REPORT.

>> GOOD EVENING, COUNSEL. I DON'T THINK THIS IS TOO BORING. IT IS GOOD NEWS. THE CITY OF ROWLETT'S CHARTER REQUIRES AN ANNUAL INDEPENDENT AUDIT OF THE CITY'S FINANCIAL RIGORS EACH YEAR TO BE PERFORMED BY CERTIFIED PUBLIC ACCOUNTANT WITH RESULTS READ INTO THE RECORD AT A COUNCIL MEETING. IN COMPLIANCE WITH THIS REQUIREMENT, THE CITY'S INDEPENDENT AUDIT FIRM IS HERE TO PRESENT AND READ INTO THE RECORD RESULTS OF THEIR AUDIT OF THE CITY'S FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30TH OF 2023 ICLUDING AN OPINION ON THE FAIR AND ACCURATE STATEMENT PRESENTATION OF THE FINANCIAL STATEMENTS, ANY DEFICIENCIES THEY FOUND IN THE CITY'S ACCOUNTING PRACTICES, PROCEDURES, AND INTERNAL CONTROLS. ANY CONCERNS OR ISSUES THEY FOUND DURING THE AUDIT PERIOD AND HIGHLIGHT FINANCES FOR THE FISCAL YEAR. THE FINANCIAL REPORT WAS

[00:30:15]

REPORTED TO THE FINANCE COMMITTEE YESTERDAY, FEBRUARY 19TH, AHEAD OF TODAY'S COUNCIL MEETING AND PRESENTATION TO COUNSEL. AT THIS TIME, I WOULD LIKE TO INTRODUCE CLAIRE WOOTEN, A REPRESENTATIVE OF WEAVER AND UR AUDIT FIRM, TO PRESENT THE REPORTED RECORD TO YOU.

>> I AGREE, THIS IS THE EXCITING PART. SO, I AM THE SENIOR MANAGER ON THIS AUDIT. MY NAME IS CLAIRE WHAT'S IN, IT'S NICE TO BE IN FRONT OF YOU TODAY. I ALSO , ON THIS AUDIT WAS JENNIFER RIPPER, THE SHE WAS APARTMENT -- THE PARTNER ON THIS ENGAGEMENT. SHE CANNOT BE HERE TONIGHT. THIS IS AN OVERVIEW OR SUMMARY OF THE RESULTS OF THE AUDT WE PRESENTED TO THE AUDT COMMITTEE YESTERDAY. STARTING ON THE TOP LEFT, WE ARE REQUIRED TO NOTE TO YOU ANY SIGNIFICANT CHANGES FROM OUR ORIGINAL PLANNED AUDIT PROCEDURES, WHICH FOR THOSE IF WE HAD PLANNED OUT AUDIT PROCEDURES AND DETERMINED THERE WERE SIGNIFICANT ISSUES WITH INTERNAL CONTROLS OR SIGNIFICANT FINDINGS WE WOULD THEN HAVE TO CHANGE OUR PROCEDURES, DESIGN NEW PROCEDURES AND GO FROM THERE BUT WE DID NOT HAVE TO CHANGE ANY PROCEDURES BASED ON THE RESULTS OF OUR FINDINGS. THERE WERE NO FINDINGS WE NEEDED TO PRESENT TO YOU. THERE WERE NO CHANGES TO SIGNIFICANT RISKS EITHER. WE DID RECOGNIZE IMPROPER REVENUE RECOGNITION, WHICH IS A BASIC RISK ACROSS ENTITIES INCLUDING COMMERCIAL BUSINESSES OUT THERE, SO IT IS A SIGNIFICANT RISK REALLY FOR ANY AUDIT CLIENT. GOING DOWN OUR AUDIT REPORTS FOR OUR RESULTS, WE HAVE ISSUED AN UNMODIFIED AUDIT REPORT ON THE FINANCIAL STATEMENTS. THAT IS THE CLEANEST OPINION YOU CAN RECEIVE ON A SET OF FINANCIAL STATEMENTS. OUR AUDIT OPINION IS MODIFIED TO DISCLOSE THAT THE CITY HAS IMPLEMENTED STANDARD STATEMENT NUMBER 96, WHICH IS THE SUBSCRIPTION-BASED I.T. ARRANGEMENTS . FOR THE SUBSCRIPTION-BASED I.T. ARRANGEMENTS THAT WERE IDENTIFIED, THEY WERE PUT ON THE BALANCE SHEET IS BOTH AN ASSET AND A LIABILITY SO WE ARE REQUIRED TO HAVE AN EMPHASIS PARAGRAPH TO HIGHLIGHT THAT THE CHANGE HAS BEEN MADE, THEN WE ALSO ISSUED AN UNMODIFIED OPINION ON COMPLIANCE FOR EACH FEATURE FEDERAL PROGRAM , AND ON INTERNAL CONTROLS AND COMPLIANCE WITH UNIFORM GUIDANCE. AND THEN THE RESULTS OF OUR WORK PERFORMED. DURING THE COURSE OF THE AUDIT, WE IDENTIFIED NO UNCORRECTED MISSTATEMENTS, WHICH THOSE ARE MISSTATEMENTS WE CONSIDER PAST ADJUSTING ENTRIES THAT WE DEEM IMMATERIAL ENOUGH TO PASS ON. WE DID NOT IDENTIFY ANY OF THOSE, NOR DID WE IDENTIFY ANY ADJUSTMENTS THAT WERE COMMUNICATED TO MANAGEMENT. SO, REALLY, THERE WERE NO ADJUSTMENTS FROM THE ORIGINAL SET OF NUMBERS THAT MANAGEMENT GAVE TO US. THE NUMBERS THAT MANAGEMENT GAVE TO US ARE WHAT IS PRESENTED IN FRONT OF YOU. AND THERE WERE NO IDENTIFIED SIGNIFICANT DEFICIENCIES, AS WELL, SO WE DID NOT IDENTIFY ANY POINTS FOR IMPROVEMENT FOR FINANCE OR ANY OF THE OTHER INTERNAL CONTROL TRANSACTION CYCLES. WE IDENTIFIED NO SIGNIFICANT DEFICIENCIES OR MATERIAL WEAKNESSES OR POINTS FOR IMPROVEMENT AND THEN THERE ARE NO INDEPENDENCE MATTERS TO NOTE, SO WE WERE INDEPENDENT AS A FIRM AS A WHOLE, AND AS AN AUDIT TEAM AND LAST ON THE BOTTOM RIGHT, AS OF THE DATE OF THESE COMMUNICATIONS, THERE ARE NO OTHER ITEMS. NO OTHER WRITTEN LETTERS OR OTHER ITEMS WE HAVE COMMUNICATED TO MANAGEMENT THAT WE HAVE NOT COMMUNICATED TO YOU, SO THERE ARE NO OTHER LETTERS I NEED TO LET YOU KNOW OF. TO GO THROUGH SOME QUICK FINANCIAL HIGHLANNUAL COMPREHENSIVE FINANCIAL SUPPORT . IT'S BROKEN DOWN INTO FOUR SECTIONS. THERE'S THE INTRODUCTORY SECTION THAT INCLUDES THE TRANSMITTAL LETTER. THAT IS THE LETTER FROM THE DOCUMENTS TO YOU THE CITIZENS. THERE IS THE CERTIFICATE THAT THE CITY EARNED ON LAST YEAR'S REPORT THAT IS PRESENTED IN HERE AND THEN IT ALSO INCLUDES THE LIST OF PRINCIPLE OFFICIALS ON THE ORGANIZATIONAL CHART. THEN THERE IS THE FINANCIAL SECTION, WHICH IS THE MEAT OF THE REPORT AND THAT INCLUDES OUR OPINION LETTER, MANAGEMENT'S DISCUSSION AND ANALYSIS, BASIC FINANCIAL STATEMENTS, FOOTNOTES, THE REQUIRED SUPPLEMENTARY INFORMATION ABOUT THE PENSION AND THE HEALTH PLAN AND THEN THE COMBINING STATEMENTS FOR THOSE NON-MAJOR FUNDS THAN IT ALSO

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INCLUDES STATISTICAL INFORMATION WHICH IS A TEN-YEAR SPREAD OF INFORMATION AND THEN THE SINGLE AUDIT SECTION WHICH COVERS YOUR FEDERAL AWARDS AT THE BACK OF THE REPORT. SO, GOING OVER YOUR FISCAL FUNDS IN 2023, THE TOTAL REVENUE WAS 80 MILLION COMPARED TO LAST YEAR OF REVENUE, 79.6. THE LARGEST PIECE WAS THE PROPERTY TAXES, MIXED BEVERAGE AND SALE TAXES.

PROPERTY TAX REVENUE INCREASED 9.6% DUE TO AN INCREASE IN ASSESSED VALUATION AS WELL AS CONTINUED INCREASES IN SALES TAXES. THE INTERGOVERNMENTAL REVENUE DECREASED 7.3 MILLION, OR 68%, AND THAT WAS DUE TO ARPA FUNDING THAT WAS EARNED LAST YEAR IN FISCAL 22, SO BECAUSE IT WAS ONE TIME FUNDING, IT WAS NOT EARNED AGAIN. GOVERNMENTAL FUNDS EXPENDITURES IN FISCAL 23 TOTALED 91.4 MILLION COMPARED TO 80.5 MILLION IN FISCAL 22. WHICH WAS AN INCREASE OF 10.9 MILLION, OR 13.5% COMPARED TO 2022. THE LARGEST CHANGES WERE RELATED TO PUBLIC SAFETY, WHICH INCREASED $3.6 MILLION DUE TO SALARY INCREASES IN THE HIRING OF ADDITIONAL EMPLOYEES AS WELL AS CAPITAL OUTLAY THAT INCREASED $2.7 MILLION AND THAT'S RELATED TO DIFFERENT PROJECTS THAT YOU HEARD ABOUT DURING THE STATE OF THE CITY. FOR YOUR FUND BALANCES, THE ENDING COMBINED FUND BALANCE TOTALED 113.1 MILLION, BROKEN OUT BY THE GENERAL DEBT SERVICE CAPITAL PROJECTS IN YOUR OTHER GOVERNMENTAL FUNDS, THEN THIS PARAGRAPH DOWN BELOW SHOWS HOW THAT 113 MILLION IS SITTING THERE, SO THE LARGEST PIECE OF IT, 66.7% IS CONSIDERED RESTRICTED, SO A LOT OF THOSE FUNDS, ESPECIALLY IN THE CAPITAL PROJECTS FUND ARE SITTING THERE BUT LEGALLY RESTRICTED FOR THE USE OF BOND PROJECTS, SO MONEY THAT COMES IN RELATED TO BOND PROCEEDS IS REQUIRED LEGALLY TO BE SPENT ON THOSE PROJECTS. MONEY THAT COMES IN IS LEGALLY RESTRICTED TO BE SPENT ON THOSE GRANT FUNDS AND DEBT SERVICE MONEY IS FOR THE PAYOFF OF DEBT, SO MOST OF THAT MONEY IS LEGALLY RESTRICTED TO BE USED AND SET ASIDE FOR THOSE PURPOSES THEN THERE IS A PIECE SET ASIDE BY MANAGEMENT AND THE GRAIN BRACKET SHOWS WHAT IS ON ASSIGNMENT, AVAILABLE TO BE SPENT. FOR YOUR BUDGETARY HIGHLIGHTS FOR YOUR GENERAL FUND, REVENUES HAD A FAVORABLE VARIANCE OF 4.3 MILLION, PRIMARILY DUE TO HIGHER-THAN-EXPECTED PROPERTY TAX, SALES TAX, BUILDING AN AMBULANCE FEE AND THEN EXPENDITURES HAD A VARIANCE OF 1.1 MILLION, WHICH ACTUAL EXPENDITURES WERE 54.9 MILLION COMPARED TO A BUDGET OF 56 MILLION, AND THAT WAS AS A RESULT OF SALARY, SAVINGS, AND TIMING OF PURCHASE OF CAPITAL EQUIPMENT. AND THEN LASTLY, FOR YOUR ENTERPRISE FUNDS, THAT IS YOUR WATER, SEWER, DRAINAGE AND REFUSE FUNDS. CHARGES FOR SERVICES EXCEEDED EXPENSES BY 3.6 MILLION IN YOUR WATER AND SEWER FUND. YOUR CHARGES FOR SERVICE REVENUES INCREASED OVER THE PRIOR YEAR BY .5 MILLION, AND THAT WAS A RESULT OF 6% INCREASE TO THE WATER CUSTOMER VOLUME RIGHT. THE FUND ALSO RECEIVED $4.7 MILLION IN CAPITAL CONTRIBUTIONS AND .8 MILLION IN IMPACT FEES. YOUR REFUSE FUND HAD AN INCREASED .2 MILLION CONSISTENT WITH PRIOR-YEAR ACTIVITY AND THEN YOUR DRAINAGE FUND, THAT POSITION INCREASED .8 MILLION DUE TO AN INCREASE IN SERVICE CHARGE REVENUES, MOSTLY DUE TO A COMBINATION OF AN INCREASE IN MISCELLANEOUS DRAINAGE IMPROVEMENTS CITYWIDE AND APPRECIATION, AS WELL. THAT IS ALL I HAVE TO PRESENT TO YOU. I WANT TO OPEN THE FLOOR IF YOU

HAVE ANY QUESTIONS. >> CITY COUNCIL, THE FINANCE COMMITTEE MET YESTERDAY TO GO OVER THIS IN DEPTH. AGAIN, A GREAT AUDIT REPORT , UNMODIFIED OPINION. THAT IS ALWAYS THE

[3C. Update from the City Council and Management: Financial Position, Major Projects, Operational Issues, Upcoming Dates of Interest and Items of Community Interest. ]

BEST OUTCOME, SO ANOTHER GREAT YEAR WHEN IT COMES TO OUR AUDIT, AND THANK YOU FOR YOUR HELP ON THAT. AND, THE FINANCE TEAM, AS WELL. COUNSEL QUESTIONS? THANK YOU SO MUCH.

>> THANK YOU. >> ALL RIGHT. OUR NEXT ITEM IS ITEM 3C, UPDATE FROM THE CITY COUNCIL MANAGEMENT FINANCIAL POSITION, MAJOR PROJECTS, OPERATIONAL ISSUES, UPCOMING DATES OF INTEREST IN ITEMS OF COMMUNITY INTEREST. COMING FROM THE CITY SECRETARY'S OFFICE, EARLY VOTING FOR THE MARCH 5TH, 2024 PRIMARY ELECTION STARTS TUESDAY FEBRUARY 20TH AND ENDS

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ON MARCH 1ST, 2024 AND YOU CAN CHECK OUT OUR WEBSITE FOR ALL INFORMATION REGARDIN EARLY VOTING. FROM THE ECONOMIC ENGAGEMENT DEPARTMENT, SPRING LUNCH ON THE LAWN SERIES KICKS OFF MARCH 24TH. JOIN US EVERY DAY IN THE MONTH OF MARCH. YOU CAN CONTACT OUR DOWNTOWN MANAGEMENT AT M BAR TREND FOR MORE INFORMATION. THE LIBRARY SEARCHING FOR MORE TUTORS FOR THEIR GD -- GED PROGRAM. CONTACT 97246363971. FROM THE PARKS AND RECREATION DEPARTMENT, THE PARKS ADVISORY BOARD IS HOSTING THE SECOND SAND BASS FISHING TOURNAMENT ON MARCH 2ND. REGISTRATION IS CURRENTLY OPEN ONLINE OR BY CALLING THE ROWLETT COMMUNITY CENTER. MORE INFORMATION IS AVAILABLE BY VISITING THE PARKS AND RECREATION'S PAGE ON THE CITY'S WEBSITE. WE HAVE ANOTHER SPECIAL ANNOUNCEMENT,

MAYOR PRO TEM SHINDER. >> AS USUAL, WE HAVE A FEATURED ANIMAL. THIS IS ZULU. FIRST AND FOREMOST, CAN WE TALK ABOUT THOSE ADORABLE EARS? ONE OF MANY CHARMING CHARACTERISTICS ABOUT ZULU. HE IS NOT ONLY GREAT ON A LEASH, BUT ALSO DOES NOT JUMP ON PEOPLE, EITHER. IF YOU LOVE ADVENTURES WERE JUST A WALK AROUND THE NEIGHBORHOOD OR THE PARK, ZULU IS YOUR GUY. IF YOU WOULD LIKE TO MEET ZULU OR ANY OF THE OTHER ADOPTABLE ANIMALS, PLEASE CONTACT ANIMAL SERVICES AT 972-412-6219. YOU HAVE THAT MEMORIZED BY NOW, RIGHT? OR, COME BY 4402 INDUSTRIAL STREET FROM 10:00 A.M. TO 5:00 P.M. TUESDAY THROUGH SATURDAY. THE MAYOR'S PRESENTATION WAS ABSOLUTELY AMAZING AND IT IS A HARD ACT TO FOLLOW, BUT I DO HAVE A BRIEF STATE OF THE SHELTER UPDATE TO GIVE YOU. NONE OF OUR DOGS ARE TIME TRAVELERS AS FAR AS I KNOW, BUT I'M NOT SO SURE ABOUT THE CATS. CITIZENS I KNOW HAVE HAD ONGOING CONCERNS ABOUT THE CONDITION OF OUR FACILITY, AND SOMETIMES RIGHTLY SO. IN GOVERNMENT, NOTHING PROCEEDS AS QUICKLY AS WE WOULD LIKE FOR IT TO, BUT WE HAVE MADE MANY IMPROVEMENTS AT THE SHELTER OVER THE PAST FEW MONTHS. IF YOU HAVE BEEN OUT THERE BEFORE AND YOU GOT THERE NOW, YOU ARE SURE TO NOTICE THE DIFFERENCE. THIS IS THE UPDATE FROM OUR SHELTER MANAGER, KOLEA MORRIS. WE HAVE SOME EXCITING NEW DEVELOPMENTS AT THE SHELTER. WE BEGAN WITH ADDING FOUR NEW PLAY ENCLOSURES FOR THE DOGS, AND REPAIRED SOME OF THE OLDER ONES. WE HAVE INSTALLED NEW CAMERA SYSTEMS FOR ENHANCED SECURITY. WE HAVE MODIFIED OUR INTAKE PROTOCOLS TO LESSEN THE POSSIBILITY OF A DISEASE OUTBREAK. WE ESTABLISHED A NEW PARTNERSHIP WITH ANIMAL SERVICES AND OPERATION KINDNESS, AND THAT OPERATION KINDNESS WILL ASSIST WITH STERILIZING OUR ANIMALS.